Sunday 13 September 2015

Will cognitive capitalism migrate with migrants?


It is little surprise that people want to move from badly organised countries to better organised ones. What is more surprising is that the causes of bad national organisation are so often ascribed to external factors rather than to the people who live in such countries. The theory seems to be that some people, by an accident of birth, had the good fortune to be plonked down in a place with laws, institutions, roads, schools and hospitals, while others had the misfortune to be born in places with dictators, gangs, muddy tracks and slums. According to this world picture, if you move people from the unfortunate to the fortunate geographies, then the world’s problems are solved.

On the other hand, if you attribute the way a society works to the people that compose it, then genetics and culture are more important than geography. The English speaking peoples have maintained their characteristics in the contrasting and unfamiliar geographies of Australia and Canada, for which little in the temperate British Isles prepared them. They managed to deal with the heat of India and the humidity of Buenos Aires, and were little impeded by climate in the management of their Empire, though they fell to diseases. They gave up colonialism because the indigenous peoples demanded it, not because they went native.

Currently, Europe has a borders crisis. Typically, few leaders will say so. A pity. If the crisis is recognised as being about borders, borders may be strengthened. If the crisis is described as being about migrants, solutions will tend to revolve around dealing with migrants, and the easiest solution appears to be providing things for them.

Although the personal advantages of moving from badly organised to well organised countries are obvious, it leaves unanswered why are some countries badly organised and poor and other well organised and rich.

Some years ago Heiner Rindermann and I answered this question in the way that many others had done: It’s the people, stupid. If people solve problems in a sensible way they tend to build up institutions, laws and physical structures to facilitate a civilised life. If people cannot solve problems they have weak institutions, feeble laws and cannot maintain the fabric of civilisation.

Of course, seen from a very long-term perspective, people become adapted to the challenges of their geographies. One possible explanation is that the harder the geography the more people become adapted to problem solving per se, over and above geography specific adaptations.

I thought it worthwhile to re-visit the theory of cognitive capitalism, to rehearse the main features, and to provide a fresh link to the published version of the original paper.

The aim of the study was to check the effect of cognitive ability on national wealth by using different variables, larger data samples, and different statistical methods than had been used in previous studies. We controlled for the influence of other important determinants  of wealth. Three ability levels—the mean, 95th, and 5th  percentiles—were compared, so as to see whether the intellectual class really had a disproportionate impact on national wealth.

We argued that cognitive ability influences wealth through its effects on high achievement in technological and scientific research (indicated, e.g., by numbers of patents and scientists) and through improvement of economic institutions (economic freedom). The effect of cognitive ability on wealth should remain stable despite using different data sets, different indicators of intellectual and scientific achievement—including the number of eminent scientists in a country’s past—and more sophisticated statistical analyses, or despite allowing for the general education level of society. Using TIMSS results from 1995 to 2007, PISA results from 2000 to 2006, and PIRLS results from 2001 to 2006, we calculated mean ability values for 90 countries.

Here are the results, in the full version:


Here is the simpler version, including the historical scientific eminence data from 800BC onwards from Charles Murray’s “Human Accomplishments” data set.


Naturally, this suggest that the people who have lived in those countries since ancient times have a great influence on the societies and economies in the current times, either through genetics or culture or both.

Nobel prizes since 1900 are another way of making the same point.


Our conclusions were: Wealth in modern times is the result of cognitive capitalism. Cognitive capitalism refers to the idea that the cognitive ability of society as a whole, and of its cognitive elite in particular, is the prerequisite for the development of technological progress, for the historic development of modern society with its increasing cognitive demands and complexity, and for the wealth-furthering norms and institutions that form the core of the capitalist system (economic freedom, free markets, rule of law, property rights). In effect, cognitive ability is crucial in creating and sustaining a high-achievement milieu leading not only to economic growth and wealth, but also to a democratic and free society.

Economies will become larger because of migration, but that does not necessarily mean that per capital wealth will increase. Unless migrants contain significant numbers of people of IQ 125+ then a really positive impact on national wealth is unlikely.


  1. The thing that needs explaining is the Industrial Revolution (and Agricultural Revolution). Two questions suffice: why did it not happen until 1760-1820, and why did it happen in Britain?

    Does your work shed any light on this very odd phenomenon? Come to that, how to explain classical Greece?

  2. Interesting work! Any thoughts on the negative (or small) loadings on mean cognitive ability? I understand that the 95th percentile cognitive ability loadings are larger and positive, but this still seems counterintuitive to me. Would it be possible to show a scatterplot matrix for the mean and 95th percentile values for cognitive ability along with high STEM achievement and economic freedom? (a plot of the correlations would also be interesting)

    After writing the above I did see this comment in the supplemental material: 'Because of the high correlation (r=.97) between “cognitive ability mean” (CAM) and “high cognitive ability mean” (HCAM95%), path coefficients are not stable.', but would still be interested in anything else you have to add.

    1. The full reply is rather complicated. We used the bootstrap procedure to randomly delete cases and variables 999 times so as to test the power of the "top 95th percentile" effect, and found that it held up. Independently, the Lubinski and Benbow results show that the top 99.9 percentile are disproportionately productive. Search for Lubinski on the blog

    2. Thank you for the reply, Dr. Thompson. Bootstrapping sounds like a good way to check. Given the "path coefficients are not stable" comment I quote above it seems surprising that the top 95% effects would hold up under bootstrapping (and not be randomly split with the 0.97 correlation mean). That said, I find your results very believable. Thanks for the Lubinski (SMPY) reference. SMPY is a great source for looking at the contributions of high achievers (I am an avid reader/commenter on Steve Hsu's blog where he mentions it frequently).

      It seems like a good way of testing the "top 95th percentile" effect would be to look at societies where the correlation with the mean breaks down. Has anyone tried doing this? Perhaps with historical colonial societies? [although it might be necessary to try different cutoffs (e.g. 99% etc.) depending on the relative population sizes.] Have you found any compelling reasons to choose between the top 90/95/99/99.9 percentiles as being the most important level?

      Thanks again and I am enjoying reading your blog. I find it encouraging to see researchers tackling controversial but important topics in a data driven fashion.

    3. Thanks. Good to have you as a reader.No particular reason for 95th percentile, just a way to estimate effects of smart fraction. Looking at societies with particularly bright elites is a good idea, but the answer is known: they are mostly either Jewish or Chinese or Japanese or Korean.

  3. These points are important to think about, and are also a way in which the psychometric studies that we are interested in can add to this debate (if anyone with the power to influence policy was interested).

    But having seen over the weekend the 'black flag' (ISIS) selfies taken in St Peter's square, and video footage of German commuters looking at their phones and out of the window as a group of young refugee men chant a fighting surah on the train, punctuated with hearty bellows of "Allahu Akbar", I suspect that the cognitive capacity of refugees/immigrants is not going to be the primary issue of concern, as this tragedy plays out in Europe.

    1. "I suspect that the cognitive capacity of refugees/immigrants is not going to be the primary issue of concern, as this tragedy plays out in Europe."

      Really? Please check this: